There is a lot of interest in the use of Bitcoin. But there are more questions about what it is, how secure it is and whether it is a viable form of payment for both individuals and business. So we decided to do a little digging to learn more about it.
Bitcoin is a peer-to-peer payment system and digital currency which was first mentioned in 2009. It is a cryptocurrency because it uses cryptography to control the creation and transfer of money. Allegedly, it is safer to make and receive payments this way than through traditional payment forms.
Users send payments by sending signed messages to the network. Miners are the participants who verify and timestamp transactions into a shared pubic database called a “block chain”. They are then rewarded with transaction fees and newly minted bitcoins. The bitcoins (note the lower case b for the currency) can be obtained by mining is in exchange for products, services and other currencies. Bitcoin (upper case B indicates the process itself) seems to be on the rise of the new, trendy way to transfer funds.
Who uses it? Is it a secure way to transfer funds? USA Today says that the typical user has been profiled as a tech-savvy male, 25 to 40, with above-average income, commonly residing on one of the
coasts. Several surveys and reports show similar findings, including data
released by Quantcast last April. U.S.
Enterprises TV notes that bitcoins can be stolen and chargebacks are impossible. Note the case of the network reporter who recently aired a segment on how Bitcoin worked and found his Bitcoin account had been hacked and his bitcoins stolen.
The true value of using bitcoins has yet to be seen. Its value should grow as a viable payment source once more businesses accept it and more individuals use it as a form of payment. We want to know if you use bitcoins on certain sites to purchase merchandise or services. If so, how did it work for you?